Proving You Don't Owe Taxes

If it would help, there are more than 100 US qualified tax preparers (CPAs and EAs) in Israel. Perhaps one of them can help you. You can find them on the IRS Preparer Directory, here:

How would a new tax preparer have any idea that no taxes were owed with respect to money in a bank account?

The issue isn't whether any taxes are owed on the amounts in the account, but rather whether a claim could be made on the account for unpaid taxes of any sort. Account transcripts from the IRS would indicate if there is any outstanding tax liability.

Ira Smilvitz, EA Leonia, NJ

That would that indicate if there were subsequent income subject to tax? Sounds like the tax preparer would be going out on a limb. Are they smart enough to couch their opinion with lots of "based on the communications I have received from the individual . . ."?

No. The tax professional isn't making any assertion as to the taxpayer's status or the validity of any information the taxpayer has provided. What the tax professional will do is to get a Tax Information Authorization (8821) from the taxpayer, then retrieve the relevant account transcripts from the IRS computers and give them to the taxpayer to do with as s/he wishes. The account transcripts reflect the current status of the taxpayer with regard to the IRS. The transcripts will show $0 balance if there is no additional tax owed.

Of course, the transcript only shows tax "assessed", either through self-declaration (via a filed tax return) or subsequent IRS assessment action. It won't show proposed changes to the tax liability which haven't worked their way through the process to final assessment yet.

Ira Smilovitz, EA Leonia, NJ

I think he is saying he can't get the transcript because he needs an American phone number to get an IRS id. Is that a new thing?

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The prerequisites for applying for a personal account have changed and continue to change. as the IRS tries to expand direct access to tax records while maintaining privacy/security. An individual taxpayer living overseas will have problems trying to create a personal account with the IRS. The rules are somewhat different for tax professionals.

Ira Smilovitz, EA Leonia,, NJ

You know, if the taxpayer cannot set up an on line account, then he must request the transcript by mail on Form 4506-T. It's sent to the taxpayer's last known address, the address on the most recently filed tax return or most recent correspondence. He may need to file an 8822 first to change the address.

And an attempt to get a transcript by calling the automated number, gives a message that it can't provide one to that SSN. Possibly because of the overseas mailing address.

When I try to use ID.Me I get to a point where it wants me to take a selfie with a smart phone. It accepts only a small set of places. So then I tried to go through the computer using a webcam and my passport. I get past the picture matching, but then it asks for my address. It only accepts US addresses.

Try this site for help: